It's been more than fine for me. I store some videos on it and my entire music collection. I use it for work, for multi-media, browsing, etc. It shouldn't hold you back with stuff you would need for medical school.
As for memory, it's fully loaded with 4GB. No issues at all with accessing/using multi-media. What's cool about is it uses a different storage media technology (Flash drive), which makes it even faster to load and read the data from the disk. So it's actually faster than computer with traditional disk drives from a performance standpoint.
The storage will only be an issue if you plan to permanently store an archive of hi-def movies on your computer. If that's the case, laptops aren't really ideal for those and people usually get an external disk drive. And this is also possible with the MacBook air.
It doesn't have a CD/DVD/Blu-Ray drive, nor does it have an Ethernet jack. It's fully designed to access the Cloud via Wi-Fi technology.
Hmm...I never considered that. It would SUCK to not have an ethernet jack. I use mine every few days. I think I've finally gotten over my 'it needs a CD drive' thing (even though I still use that, too) because I can buy an external, but I never considered Ethernet.
That being said, I come from a household with both Macs and PCs, use the Mac at work myself, and have a PC at home...I haven't really found Mac to be as wonderful as it's cracked up to be. In the past 5 years, the Mac has gotten a virus and the Windows hasn't (lol) which I realize is an anomaly, but still! Honestly, the only reason our work gets them is because of the metal body (they don't want to replace them for physical damage), but more and more PCs seem to have it these days.
To be 100% real, you are NOT going to run yourself out of the storage or RAM on any normal laptop these days unless you are using a lot of heavy programs (you're not...you'll be using Office and Chrome, unless you are silly and still use IE or Safari), doing data collection with hundreds of pic files (sorry, did I say hundreds? I meant thousands), or dual-booting several OS's. It is possible if you own the computer for years, but at that point just buy an external hard drive.
Myself, I plan to pick up a Surface when I finally make it to Med...tried it out in the store and it was just NICE. Super responsive, super light, had plenty of specs and honestly seemed like the perfect bridge of tablet and computer. It's expensive, sure, but I'd rather spend the money on something light, flexible, and responsive than a heavy 'powerhouse' laptop with specs I will never come close to needing...I'll just have to be sure to get an Ethernet adapter!

It's basically the Windows version of the Air, only far more portable with a touchscreen and an OS designed to USE it. It has less memory than the Air (128 as of now) but the same RAM. I would trade memory for usability any day, especially seeing as how I come nowhere CLOSE to using that much memory on the laptop I spend 50% of my waking hours on!